SMB Cybersecurity refers to the strategies, tools, and practices small and medium-sized businesses (SMBs) use to protect their digital assets, networks, and systems from cyber threats. Unlike larger enterprises, SMBs often face unique challenges, such as limited budgets, fewer dedicated IT resources, and a lack of cybersecurity expertise, which can make them more vulnerable to cyberattacks. Size is no longer a protective barrier. SMBs are now seen as viable, valuable, and vulnerable targets. According to Crowdstrike’s latest report titled “The State of SMB Cybersecurity Survey”, “size matters” when it comes to defining organizational-level cyber readiness. 47% of micro-businesses (only, HAHA!) have a security plan, compared to nearly 90% of larger SMBs, revealing a clear maturity divide by company size.
Consequences?
Despite growing awareness, many SMBs remain stuck in the “cybersecurity gap”—where threat recognition outpaces threat response. This imbalance leaves them exposed to new types of cyber threats, often unprepared without the resources, expertise, or budgets required to counter modern threats or hire and train people who can manage the crisis.
To illuminate the true state of SMB cybersecurity readiness, CrowdStrike commissioned an in-depth global survey of organizations with fewer than 250 employees.
The findings are clear: while progress is being made in awareness, significant gaps in execution persist. This article explores the data, the patterns, and the path forward for SMBs aiming to build a mature, resilient cybersecurity posture.
Introduction: A New Era of Cyber Risk for Small Businesses
Small and medium-sized businesses (SMBs) have historically flown below the radar of cybercriminals. But that reality has changed. Today, cyber adversaries—supercharged by automation and generative AI—can scale attacks with unprecedented precision and volume.
Effective SMB cybersecurity includes measures like data encryption, secure access controls, employee training, firewalls, and regular software updates to prevent data breaches, ransomware attacks, and other types of cybercrime. Ensuring cybersecurity is critical for protecting sensitive business data, maintaining customer trust, and complying with industry regulations.
In this exclusive CyberTech Insights article, our analysts take a sagacious route to gather key takeaways from the report on cyber resilience and how CISOs and CIOs can stop complacency from turning into an irreversible catastrophe.
Here you go…
Key takeaway #1: SMBs Understand the Risk, but Struggle to Evolve Defenses
91% of SMBs use firewalls, the most-used cybersecurity tool; 11% use AI-powered tools.
A striking 94% of surveyed SMBs report being knowledgeable about cybersecurity threats. On the surface, this seems promising. Yet when we look deeper, the disparity between knowledge and action becomes stark.
A striking parity in breach rates—25% among small and mid-sized businesses (SMBs) with formal cybersecurity plans versus 24% without—highlights a critical flaw in current security postures. This data signals a deeper issue: merely having a cybersecurity strategy is no longer a sufficient safeguard. The findings suggest that many SMBs either adopt inadequate frameworks or fail in the operational execution of their security initiatives.
Kris Bondi, CEO and Co-Founder of Mimoto said, “The rise of AI is growing the sophistication, speed, and ultimately, the success of attacks. The biggest risk AI brings to businesses, both small and large, is the ability for cybercrime to scale quickly. Just like any other business, AI enables the ability to automate and perform more functions quicker. For cyber attackers, this means the ability to launch more attacks with the same resources. For example, brute force attacks are faster as is the ability to experiment with different AI generated attacks simultaneously. Other AI risks include the relatively new phenomenon of sophisticated attack tools now being available to unsophisticated bad actors and, of course, the use of deepfakes, which continue to improve.”
Kris added, “One of the biggest challenges for cybersecurity professionals is having too many alerts, and too many false positives. AI is only able to automate a small percentage of responses. It’s more likely that AI will eventually automate additional requirements for someone deemed to be suspicious or the elevation of alert so that a human can analyze the situation. However, if companies only rely on historical data to train models for anomaly detection, they set themselves up to miss newer attack tactics. Bad actors are also continuing to innovate to improve their approaches. Security in a post-AI world should include anomaly detection combined with other approaches that provide real-time context. This gives security professionals the data and tools needed to make enhanced analytical decisions.
Today’s security professional faces an everlasting onslaught of alerts and issues coming at them, often with limited context. A third of alerts are currently ignored because security teams are receiving too many. They don’t have time to thoroughly assess everything that is coming at them. The promise of (future) AI is that it will reduce the number of alerts and add needed context to those that are presented to a human. This gives the team space to use their analytical skills.”
For CISOs and CIOs, this reveals a fundamental management imperative: shift the focus from documentation to dynamic execution. Cybersecurity plans must be more than compliance checklists—they must be rigorously tested, continuously updated, and deeply integrated into the organization’s operational workflows. Investment in threat modeling, incident response simulations, staff training, and continuous monitoring are essential to closing the execution gap.
In today’s threat landscape, preparedness is defined not by the presence of a plan, but by the organization’s ability to activate and adapt that plan under real-world conditions. As the cybersecurity marketplace matures, vendor solutions must also evolve to support not just strategy design but measurable implementation outcomes.
Many SMBs lack the basic building blocks of cyber defense—formal security plans, incident response protocols, and consistent employee training. Execution gaps remain prevalent. Without the right tools and repeatable security processes, good intentions alone won’t stop sophisticated attackers.
At the time of this announcement, Nicole Carignan, Senior Vice President, Security & AI Strategy, and Field CISO at Darktrace, said, “Faced with limited resources, including time, capital and security personnel, SMBs can make strategic investments in AI technology to bolster defenses, augment their teams, and automate processes to keep pace with threat actors who are also leveraging the technology. Specific types of AI can perform thousands of calculations in real-time to detect suspicious behavior and perform the micro decision-making necessary to respond to and contain malicious behavior in seconds. Surgical, finite autonomous response has become crucial to containing incidents and buying human defenders time to completely respond. This drastically reduces potential damage of an incident and mitigates risk, helping protect organizations, especially those with smaller security teams, from evolving threats.”
Nicole added, “Adoption of AI, specifically in response scenarios, requires transparency, explainability and control. To facilitate data-driven recommendations to autonomous action, trust needs to be built with AI’s decision-making capabilities. Our recent The State of AI Cybersecurity 2025 found that 78% of CISOs admit that AI-powered cyber-threats are having a significant impact on their organization. To combat emerging challenges from AI-driven attacks, organizations of all sizes must leverage AI-powered tools that can provide granular real-time environment visibility and alerting to augment security teams. Where appropriate, they should get ahead of new threats by integrating machine-driven response, either in autonomous or human-in-the loop modes, to accelerate security team response. Through this approach, the adoption of AI technologies—such as solutions with anomaly-based detection capabilities that can detect and respond to never-before-seen threats—can be instrumental in keeping organizations secure.”
Satish Swargam, Principal Security Consultant at Black Duck, added, “The 2025 State of SMB Cybersecurity Report from CrowdStrike emphasizes the importance of partnering with outside cybersecurity experts to protect SMB’s products and services from threats and vulnerabilities. While SMBs focus on supporting their business, partnering with trusted security service providers can provide them a better application security posture, with less impact to their budget, by leveraging a SaaS-based application security testing platform.”
- Two-thirds of SMBs say cost prevents them from upgrading security tools, and only 7% believe their current budget is fully sufficient.
- 70% of SMBs rely on outside experts to guide security decisions, highlighting the opportunity for partners to deliver trusted solutions, support, and education.
Darren Guccione, CEO and Co-Founder at Keeper Security, said, “Although Crowdstrike’s 2025 State of SMB Cybersecurity Report shows that small-to-medium businesses lag behind in adoption of new technologies, these businesses have a variety of scalable, approachable security solutions with AI assistance available. While AI-based tools open worlds of possibilities, organizations of all sizes must proceed with caution. CrowdStrike reported that 50% of SMBs feel overwhelmed by the amount of cybersecurity solutions present on the market, often feeling lost and unable to start. These organizations should begin with a thorough cybersecurity risk assessment, which can inform their search for relevant support.”
Darren added, “To protect against these evolving threats, SMB leaders should take several proactive steps. First, prioritize regular employee training to keep your team informed about the latest scams and teach them to recognize and report suspicious activities. Implementing Multi-Factor Authentication (MFA) adds an extra layer of security, ensuring that compromised credentials alone won’t grant access to malicious actors.
Utilizing advanced threat detection tools that leverage AI can help identify and respond to potential breaches in real-time. It’s also crucial to ensure that all sensitive communications are conducted through encrypted channels and to use strong, unique passwords for each account. Password management software is one of the most effective ways to protect an SMB from a cyberattack. It securely stores and manages passwords and sensitive data – which not only enhances security but also reduces time spent on password management and lowers help desk costs. Finally, it’s imperative to keep your systems up to date with the latest firmware updates and security patches to maximize system performance and patch critical vulnerabilities.
AI security tools offer advanced security features that often surpass human capabilities, which can enhance threat detection, automate responses and improve incident management. These capabilities can prove invaluable to SMBs with a small cybersecurity team, especially since CrowdStrike’s report indicates that nearly 47% of organizations under 50 employees reported not having a cybersecurity plan for their company. However, SMBs must always cautiously and carefully implement AI to avoid risks like data poisoning or biased models. Without human oversight, AI can make critical mistakes, causing these tools to hurt more than they help.”
Trey Ford, Chief Information Security Officer at Bugcrowd said, “SMBs outside of hyper-growth definitely feel a squeeze and focus on time-to-market with F&A spend controls – leaving security under-staffed and under-funded. Priorities for the SMB need to start and remain with the foundational controls – inventory, patching, and application security tooling and partnership with engineering. SSO + MFA matter – most small companies with minimal technical debt have already done this – only pick services that support SSO, and mandate MFA.
Pick the local-admin fight NOW (if you haven’t already)! If your endpoint surface area is quickly patched, and users are not operating as local admin – the cost requirement for successful attacks has been driven up to levels requiring targeted, interested parties.
- AI – Be thoughtful about your approach, security needs to partner and enable – not dictate. Especially in the SMB.
- AI as a TOOL – Find tooling to gain visibility, this may be the justification you need to lock in zero trust or cloud access tooling.
- AI as a TARGET – As an industry we’ve talked about security and privacy by design, it is increasingly clear that protecting AI will require foundational security investment in the design and build phase, where we’ve been able to effectively bolt-on security in other technology sets.
- AI as a THREAT – Let’s be thoughtful about how using AI will help us and hurt us. Take time to reflect on the trust out companies are placing in systems, and how AI will be used against us. Pointedly, take time to review HR/Recruiting pipelines, and look for ways to strengthen new-hire identity validation, AI is helping a variety of actors insert malicious actors inside companies through full-time hiring.”
Key takeaway #2: Business Size Strongly Influences Security Posture
Larger SMBs with bigger budgets are outpacing smaller ones in cybersecurity, with nearly 90% having formal security plans and 45% allocating over 6% of their budget to security, making them more than twice as likely to use AI-powered tools.
One of the clearest patterns in the research is the security maturity divide across SMB size bands. Business size isn’t just a logistical variable—it’s a major determinant of cybersecurity readiness.
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Derek Manky, Chief Security Strategist & Global Vice President of Threat Intelligence with Fortinet’s FortiGuard Labs added, “Our latest Global Threat Landscape Report clearly demonstrates that cybercriminals are fast-tracking their efforts, using AI and automation to operate at unparalleled speed and scale. The traditional security playbook is no longer enough. Organizations of all sizes need to shift to a proactive, intelligence-led defense strategy powered by AI, zero trust, and continuous threat exposure management to stay ahead of today’s evolving threat landscape.”
Derek added, “Turning the tide against cybercrime necessitates a culture of collaboration, transparency, and accountability on a larger scale. No single organization, whether they be a large enterprise or an SMB, can effectively stop cybercrime alone. Public-private partnerships can influence the disruption of large-scale cybercrime activities, leading to a safer, more resilient society. Every organization has a place in the chain of disruption against cyberthreats.”
Micro-businesses (1–49 employees): Overwhelmed and Underprepared
The smallest businesses, especially those with fewer than 10 employees, are in critical need of support. Only 47% have a formal cybersecurity plan. More than half spend less than 1% of their total budget on security. These organizations operate with minimal internal IT expertise, rely heavily on generalist staff, and often defer decisions until after an incident.
Alarmingly, 29% of micro-businesses that suffered a breach reported ransomware attacks—the highest among all SMB groups. This illustrates the paradox: micro-businesses are targeted more than they expect, and they are often the least equipped to respond.
Mid-sized SMBs (51–149 employees): Stuck in the Maturity Gap
These businesses are large enough to draw attention from threat actors, but still constrained by limited resources. While 80% report having a formal security plan, only 20% allocate more than 6% of their budget to cybersecurity. Nearly 38% say their budget is insufficient, and 18% aren’t sure if it’s enough.
This segment finds itself caught in a cybersecurity “middle class trap”—too big to ignore threats, but not yet resourced or structured to address them at scale.
Larger SMBs (150–249 employees): Moving Toward Maturity
At the upper end of the SMB spectrum, we see better alignment between awareness, investment, and action. Nearly 90% of these organizations have formal security plans. 45% allocate more than 6% of their budget to cybersecurity.
These businesses are more than twice as likely to adopt AI-driven security tools than smaller SMBs. They are beginning to exhibit behaviors and investments that resemble those of larger enterprises.
Key takeaway #3: Affordability vs. Effectiveness: A False Dilemma
67% of SMBs prioritize cost over protection, leaving them vulnerable to costly breaches as cheaper tools fail to guard against advanced threats.
Cost remains the biggest roadblock for most SMBs. Two-thirds cite affordability as the primary challenge in upgrading to more advanced cybersecurity solutions. Only 7% describe their security budget as “definitely sufficient.”
This financial tension forces difficult trade-offs—between tools and training, coverage and control, prevention and response. Many SMBs find themselves choosing between affordability and effectiveness, when the reality is they need both.
CrowdStrike’s approach emphasizes modular, cloud-native, and AI-powered solutions that scale up or down with the customer. SMBs don’t need stripped-down products—they need enterprise-grade security made accessible and manageable for smaller teams.
Key takeaway #4: Ransomware: A Clear and Present Danger for the Smallest Businesses
Ransomware is the top concern for 21% of mid-sized SMBs and 24% of larger ones, but 29% of businesses with fewer than 25 employees were hit hardest, often due to limited expertise and inadequate security controls.
One of the most concerning data points from the survey is ransomware’s disproportionate impact on micro-businesses. Among companies with fewer than 25 employees, ransomware was the most reported type of incident. Yet this same group ranked ransomware lower as a perceived threat.
This gap in perception vs. reality underscores a deeper issue—micro-businesses underestimate the risk because many still view themselves as “too small to target.” But in an era of opportunistic, automated attacks, any vulnerable endpoint is a valid entry point.
Key takeaway #5: SMBs Want Guidance, Not Just Tools
Nearly 70% of SMBs rely on IT consultants and experts for cybersecurity decisions, seeking demos, case studies, and best practices tailored to their needs.
Half of surveyed SMBs feel overwhelmed by the sheer number of security tools available to them. Without dedicated internal expertise, it’s hard to know where to begin, what to prioritize, or how to measure effectiveness.
Nearly 70% rely on third-party experts for guidance—whether MSPs, MSSPs, or consulting firms. The message is clear: SMBs need a trusted partner, not just a product catalog. They’re seeking curated solutions, practical roadmaps, and ongoing support.
CrowdStrike’s Falcon platform and partner ecosystem are built with these needs in mind—delivering industry-leading protection with simplified deployment, centralized visibility, and intelligent automation.
Frequently-asked Questions
We have compiled five intent-powered FAQs for the article “From Complacency to Catastrophe: The Unseen Cybersecurity Chasm in SMBs” reported by CrowdStrike
Why are SMBs increasingly targeted by cybercriminals?
Cybercriminals now use automated, AI-powered tools that scale attacks efficiently—making SMBs attractive, high-volume targets. With limited resources and often outdated defenses, SMBs present easier entry points than larger, more fortified enterprises.
Does having a cybersecurity plan guarantee protection for SMBs?
No.
CrowdStrike’s research shows a near-identical breach rate between SMBs with (25%) and without (24%) formal plans—highlighting that execution, not documentation, determines resilience.
How does company size affect cybersecurity readiness?
Larger SMBs (150–249 employees) are more likely to invest in cybersecurity—90% have formal plans and 45% dedicate >6% of their budget to security. In contrast, micro-businesses (1–49 employees) often lack plans, expertise, and investment, making them significantly more vulnerable.
What is the most common cybersecurity challenge SMBs face?
Affordability.
While 67% of SMBs prioritize cost when choosing tools, many sacrifice effectiveness, leading to false savings and higher breach risks. Only 7% of respondents feel their security budgets are fully sufficient.
What kind of cybersecurity support do SMBs actually want?
SMBs don’t just want tools—they want guidance.
Nearly 70% turn to IT consultants or MSPs for help. They need curated solutions, practical roadmaps, live demos, and clear best practices to make informed, strategic decisions.
Closing the Cybersecurity Gap for SMBs
The cyber threat landscape is evolving. So too must the security strategies of SMBs. While awareness has improved, execution still lags—and this gap puts thousands of smaller businesses at serious risk.
The findings from CrowdStrike’s survey provide both a reality check and a roadmap. Each segment of the SMB market faces unique challenges, but common themes emerge: affordability, complexity, execution, and trust. Bridging these gaps requires a unified effort from technology providers, industry partners, and policymakers alike.
At CyberTech Insights, we are committed to helping CIOs and CISOs of SMBs build resilience at every stage of their growth journey. Cybersecurity isn’t just for a set of decision-makers—it’s for the backbone of the global economy.
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